YOUNGER GENERATION ISN'T BUYING CARS OR HOUSES

posted by Gloria Ohland | 245mp
August 29, 2012

Two good stories in The Atlantic about why the younger generation has lost interest in cars: One cites a Bloomberg news story about how the auto industry is “concerned that financially pressed young people who connect online instead of in person could hold down peak demand by 2 million units a year.” Industry analysts at R.L. Polk & Co. were quoted as saying that “the rate of U.S. auto sales to 18-to-34-year-olds declined to 11 percent in April 2012, down from 17 percent of the same age group in April 2007, before the recession."

Jordan Weissman speculates on why in the August Atlantic: Gen Y is strapped for cash, he writes, they're mostly unemployed, and saddled with unprecedented school debt. But he adds that they’re not only turning their back on buying cars, they’re also less interested in driving, and prefer transit, biking and car-sharing. And he says it may be a global trend: The younger generation seems to be choosing access via the Internet: A University of Michigan Transportation Research study found that the number of teen drivers in countries around the world tends to fall as a country’s level of internet access increases.

In the September Atlantic Weissman and Derek Thompson write about why the Millennials aren’t buying cars orhouses, and what that means for the economy. They note that half of a typical family’s spending goes to transportation and housing: “Just as car sales have plummeted, the share of young people getting their first mortgage between 2009 and 2011 is half what it was just 10 years ago . . . Needless to say the Great Recession is responsible . . . But it’s highly possible a perfect storm of economic and demographic factors -- from high gas prices, to re-urbanization, to stagnating wages to new technologies enabling a different kind of consumption – has fundamentally changed the game for Millennials."